Back Taxeshttp://www.businessinsider.com/category/back-taxes
en-usTue, 03 Mar 2015 15:25:44 -0500Tue, 03 Mar 2015 15:25:44 -0500The latest news on Back Taxes from Business Insiderhttp://static3.businessinsider.com/assets/images/bilogo-250x36-wide-rev.pngBusiness Insiderhttp://www.businessinsider.com
http://www.businessinsider.com/airbnb-pays-hotel-back-taxes-to-san-francisco-2015-2Airbnb just paid tens of millions in hotel back taxes to San Franciscohttp://www.businessinsider.com/airbnb-pays-hotel-back-taxes-to-san-francisco-2015-2
Wed, 18 Feb 2015 16:30:36 -0500Sam Colt
<p><img style="float:right;" src="http://static3.businessinsider.com/image/54735c426bb3f74469f5db4f-480-/san-francisco-airbnb-1.jpg" border="0" alt="san francisco airbnb" width="480"></p><p>Airbnb has paid "tens of millions" in owed hotel taxes and penalties to the city of San Francisco, <a href="http://m.sfgate.com/bayarea/matier-ross/article/M-R-Airbnb-pays-tens-of-millions-in-back-6087802.php">according to SFGate</a>.</p>
<p>The short-term rental startup had technically been operating in the city illegally until San Francisco passed the so-called <a href="http://www.businessinsider.com/san-francisco-makes-airbnb-legal-at-last-2014-10">"Airbnb law"</a> which took effect on February 1.</p>
<p>That law allows people to rent their homes for less than 30 day periods, as long as they live there nine-months out of the year and register as official hosts.</p>
<p>But the city had also been seeking back taxes from Airbnb for the last few years, saying that it was essentially operating a hotel business.</p>
<p>Airbnb's decision to pay San Francisco raises the question of whether it might settle with <a href="http://www.businessinsider.com/new-york-ag-ramps-up-airbnb-case-2014-4">other cities that are seeking hotel taxes from the company</a>. It may owe up to $200 million, according to SFGate.</p>
<p>An Airbnb spokesperson told Business Insider that it had "<span>concerns about this assessment" but said it paid what was owed in full.</span></p>
<p>Here's Airbnb's full statement:</p>
<p style="padding-left: 30px;"><span>We have been engaged in a formal process with the Treasurer’s Office regarding back taxes and have been eager to reach a resolution. Two weeks ago, the Treasurer’s Office told us what they thought was owed in back taxes. Though we have concerns about this assessment <span>—</span>&nbsp;the tax rules in San Francisco are unique and the subject of ongoing litigation brought by other companies that we are closely monitoring <span>—</span>&nbsp;we have paid it in full. We remain focused on working with everyone to make sure the new law governing home sharing that took effect in February has a chance to work. Airbnb already collects and remits occupancy taxes in San Francisco, and our community contributes millions more in economic benefits throughout this great city and will continue to do so.</span></p><p><strong>SEE ALSO:&nbsp;<a href="http://www.businessinsider.com/airbnb-data-analysis-2015-2" >These are some of the cool things Airbnb is doing to learn more about you</a></strong></p>
<p><a href="http://www.businessinsider.com/airbnb-pays-hotel-back-taxes-to-san-francisco-2015-2#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="http://www.businessinsider.com/smartphone-impact-brain-body-sleep-2015-2">This is what happens to your brain and body when you check your phone before bed</a></p> http://www.businessinsider.com/33000-taxpayers-confess-to-hiding-money-in-offshore-accounts-2012-6Uncle Sam Is About To Collect $5 Billion From Offshore Tax Cheatshttp://www.businessinsider.com/33000-taxpayers-confess-to-hiding-money-in-offshore-accounts-2012-6
Wed, 27 Jun 2012 13:31:46 -0400Zachry Floro
<p><img style="float:right;" src="http://static5.businessinsider.com/image/4feb27f3ecad04ff2000001b/shore-sunset-rocks.jpg" border="0" alt="shore-sunset-rocks" /></p><p>The <a href="http://www.latimes.com/news/opinion/editorials/la-ed-student-loans-20120626,0,5491368.story" target="_blank">Voluntary Offshore Disclosure Program (OVDP), a program that lets tax cheats come clean, has led the IRS</a> to collect $5 billion dollars from people hiding their money in their offshore accounts since 2009.</p>
<p>The OVDP program was created with the goal of making it easier for tax cheats to come forward and pay taxes on their offshore assets. Since the program first launched in 2009, 33,000 people have agreed to square up with Uncle Sam.</p>
<p>When a taxpayer discloses their offshore assets to the IRS they must <a href="http://www.businessinsider.com/tips-for-filing-back-taxes-2012-4#comments" target="_blank">pay back taxes</a>, interest and late charges for offshore holdings over the last eight years. On top of that, they face a 27.5 percent penalty on however much they've been storing in their offshore vehicles.</p>
<p>Despite the 27.5 percent penalty, however, the program still sounds a lot better than getting caught by the IRS normally. Usually,&nbsp;<a href="http://www.irs.gov/businesses/small/international/article/0,,id=256774,00.html" target="_blank">offshore tax cheats are hit with fines</a> that could reach 75 percent of their holdings.</p>
<p>Even worse, cheats could be criminally prosecuted for tax evasion, fraud or failure to file, <a href="http://www.irs.gov/businesses/small/international/article/0,,id=256774,00.html" target="_blank">according to the IRS</a>. These charges could subject them to jail terms ranging from one to ten years, plus a fine of $250,000 to $500,000.</p>
<p>Unlike in previous years, the IRS has not set a definite deadline for this year's program. But don't think that means you're getting off the hook&mdash;it could announce the end of this year's program at any time.</p>
<h3><a href="http://www.businessinsider.com/satellite-pictures-of-income-inequality-2012-5" target="_blank">DON'T MISS: Satellites reveal the difference between rich and poor places &gt;</a></h3><p><a href="http://www.businessinsider.com/33000-taxpayers-confess-to-hiding-money-in-offshore-accounts-2012-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/freelance-writer-tax-deductions-2012-4Freelance Writer Wants To Know If She Can Deduct Her Cable, Subway Card, Cathttp://www.businessinsider.com/freelance-writer-tax-deductions-2012-4
Tue, 17 Apr 2012 15:24:00 -0400Jill Krasny
<p><img style="float:right;" src="http://static6.businessinsider.com/image/4e98885a6bb3f74a0c000005/ringo-jill-cat-mainecoon-pets-vet-costs.jpg" border="0" alt="Ringo-Jill-cat-MaineCoon-pets-vet-costs" /></p><p>Freelance writer Alison Espach lists <a href="http://therumpus.net/2012/04/the-sunday-rumpus-essay-things-i-wanted-to-write-off-as-a-business-expense-but-didnt/#more-100046">a bunch of the things she wonders if she could write off as business expenses</a>.</p>
<p>I asked Ken Krasny, a tax attorney in Houston who happens to be my father, for his take on what she could get away with.</p>
<p><strong>Cable</strong></p>
<p>"There was period of time when I became obsessed with re-enactments on horrible cable shows ... What was it like to make a living re-enacting other people's tragedies? I didn't know. But I wrote a short story about it."</p>
<p><strong>Krasny's take:</strong>&nbsp;"Cable TV can be deductible if it's used in your trade or business," says Krasny. "For example, if you've got a waiting room and you're a doctor and need people to be entertained. Or if you're a stock trader and need to watch <a href="http://www.businessinsider.com/blackboard/cnbc" class="hidden_link">CNBC</a> or <a href="http://www.businessinsider.com/blackboard/bloomberg" class="hidden_link">Bloomberg</a> to keep an eye on the markets. It's a stretch, but&nbsp;she might be able to get away with it if she can prove that it was related to her work&nbsp;and that she actually obtained research info. from it."&nbsp;</p>
<p><strong><a href="http://www.businessinsider.com/blackboard/metro" class="hidden_link">Metro</a> North&nbsp;</strong></p>
<p>"Visiting my childhood home is essential to my writing process; it depresses and exhilarates me in certain ways that help me write teenage characters."</p>
<p><strong><strong>Krasny's</strong> take:</strong>&nbsp;"The IRS might argue that it's a personal visit and she'd need to demonstrate that it bore some relationship to her effort to write a book. If the bedroom has casual mentions in the story, she's probably not going to get very far with it. That falls into the realm of a personal expenditure, much like buying a suit for work."&nbsp;</p>
<p><strong>Road Trips &amp; Moving Expenses</strong></p>
<p>"My characters are in cars a lot ... This is probably because I am always in a Cavalier or a Volvo, always taking very long road trips from one part of the country to another ... "</p>
<p><strong><strong>Krasny's</strong> take:</strong>&nbsp;"Road trips, movies and concerts fall into a similar genre as a trip If you can show it bears some relationship to the work you're doing, then it'll be fine," says Krasny. "Say you're a food writer and sample various restaurants, but don't want to be comped or for them to know you're there. You pay cash so no one can identify you and you can write it off.&nbsp;Keeping a log of what she's doing, hopes to get out of the trip and what she saw would help.&nbsp;It's not just enough to keep a receipt; you need to explain how it relates."&nbsp;</p>
<p><strong>Cat</strong></p>
<p>"Since I'm a writer who primarily works from home I have no co-workers... I believe loneliness in the work place is one of the many reasons writers often get cats. "</p>
<p><strong><strong>Krasny's</strong>&nbsp;take:</strong>&nbsp;"A cat is not an individual. The cat is not a dependent, though it is in an economic and personal sense. It's actually negligent and could cause a penalty since it's a false deduction."&nbsp;</p>
<p><strong>Take-out</strong></p>
<p>"(Delivery) was what made someone a New Yorker. Someone who orders Seafood Fra Diavolo and eats it on a tray while watching Law &amp; Order."</p>
<p><strong><strong>Krasny's</strong>&nbsp;take:&nbsp;</strong>"No way. Unless she's on a trip. Or if she's having people over to put together a manuscript, that's a business expense. A lot of this stuff depends on the context."&nbsp;</p>
<p><strong>Absinthe</strong></p>
<p>"As a fiction writer, it's difficult to predict the images or sounds or moments that will stay with us and worm their way onto our pages ..." This was one of them.&nbsp;</p>
<p>The IRS allows some deductions for employees buying tools of their trade, but this might be taking it a bit too far. As Gail Rosen, CPA, explains,&nbsp;<a href="http://articles.businessinsider.com/2012-02-28/news/31106815_1_tax-deductions-deductible-expense-tax-returns" target="_blank">it's like claiming airfare</a>&nbsp;to Brazil&mdash;when the trip was for purchasing spatulas.&nbsp;</p>
<h3><a href="http://www.businessinsider.com/taxes-for-freelancerrs-2012-4" target="_blank">Now see how freelancers can avoid the Ninth Circle of tax filing HELL &gt;&nbsp;</a></h3><p><a href="http://www.businessinsider.com/freelance-writer-tax-deductions-2012-4#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/tips-for-filing-back-taxes-2012-4Filing Back Taxes? Here's How To Stay Out Of Jail http://www.businessinsider.com/tips-for-filing-back-taxes-2012-4
Fri, 13 Apr 2012 16:29:55 -0400Jill Krasny
<p><img style="float:right;" src="http://static5.businessinsider.com/image/4f887ea8ecad04293200000f/wesley-snipes-tax-evasion-taxes-tax-fraud.jpg" border="0" alt="Wesley Snipes, tax evasion, taxes, tax fraud" /></p><p>A month ago, I visited the IRS office in Manhattan to find out why I'd never received my 2010 refund, despite filing everything on time and sending it via Certified Mail.&nbsp;</p>
<p>"Looks like we don't have a record of 2010 ... or 2009," the clerk said, sneering.</p>
<p>I was aghast&mdash;what upstanding citizen blunders their tax return <em>twice</em>?&nbsp;</p>
<p>Panicked, I turned to tax attorney and <a href="http://blogs.forbes.com/kellyphillipserb/" target="_blank">blogger Kelly Phillips Erb</a>, who had good news. "Whatever you think you did wrong, chances are someone did it <em>much</em> worse."</p>
<p>The woman's not kidding: She's made a living helping people file back taxes from decades ago.&nbsp;Here are her tips for doing it right:&nbsp;</p>
<p><strong>Double-check that you filed the return.</strong> Call the IRS hotline or go online (<a href="http://www.irs.gov" target="_blank">http://www.irs.gov</a>) to order a transcript of the return(s) in question. It's the only way to truly know where you stand, says Erb.&nbsp;</p>
<p><strong>If you're unsure if you filed AND need to make changes:</strong> File a 1040 X (ammended return), says Erb. DO NOT file another 1040, which will send a red flag to the IRS that there are two copies of your return floating around, stalling the process. Even if the IRS says they don't have your original, you should still file the 1040 X because you're not sure, Erb adds. &nbsp;</p>
<p><strong>If you know that you filed the 1040 but <em>don't</em> need to make changes</strong>: Send a duplicate return with a cover letter stating what happened to the return, what date it was originally sent and that the attached 1040 is a COPY. Clearly mark it as such (perhaps with a stamp) so the IRS doesn't get confused and flag it.&nbsp;</p>
<p><strong>Consider hiring a tax preparer.</strong> "Having a tax pro does wonders for dealing with stress," Erb says. "(<a class="hidden_link" href="http://www.businessinsider.com/blackboard/taxpayers">Taxpayers</a>) carry baggage, but the preparer doesn't have that so she can concentrate on solving the problem."&nbsp;</p>
<p><strong>Keep copies of everything.</strong> Goes without saying, but you should keep paper copies of everything you send to the IRS. File cabinet a mess? See <a href="http://www.businessinsider.com/keep-toss-or-shred-heres-how-to-get-a-headstart-on-your-financial-spring-cleaning-2012-1?utm_source=inpost&amp;utm_medium=seealso&amp;utm_term=&amp;utm_content=1&amp;utm_campaign=recirc#save-credit-card-offers-1" target="_blank">what to keep, toss or shred</a> during tax season here.&nbsp;</p>
<p><strong>Owe money? Prepare to pay up.</strong> For those owing back taxes, there is a failure to file penalty, which is a percentage of the taxes due, Erb explains. "There will also be interest, which can add up pretty quickly depending on how much the taxes were."&nbsp;</p>
<p><strong>Or act fast if the tax man owes you.</strong> You don't want to fall outside the statute of limitations (i.e., deadline) for receiving old tax refunds, says Erb. According to the IRS,&nbsp;</p>
<p><strong>Don't sweat it <em>too</em> much.</strong> Unless you're a true tax evader &agrave;&nbsp;la the great Wesley Snipes, the IRS won't come after you. Says Erb: "People get worried about prison, but the IRS doesn't want to prosecute these cases, even if the taxpayer's being willful for silly reasons. That said, if there's a pattern of willfulness, you show no remorse and the IRS feels like you need to be taught a lesson, well, get ready to join Wesley Snipes."&nbsp;</p>
<h3><a href="http://www.businessinsider.com/9-ways-to-spot-a-tax-preparation-scam-2012-1#preparers-who-work-from-home-1" target="_blank">Don't miss: 9 easy ways to spot a scammy tax preparer &gt;&nbsp;</a></h3><p><a href="http://www.businessinsider.com/tips-for-filing-back-taxes-2012-4#comments">Join the conversation about this story &#187;</a></p>